Sinomine(SZ:002738) Minsheng Securities·2024-08-23 09:40Investment Rating - The report maintains a "Buy" rating for the company, with a target price of 27.40 CNY per share [3]. Core Insights - The company has successfully transformed from a geological exploration veteran to a multi-metal mining platform, showcasing strong resource integration and management capabilities [2][14]. - The company has significantly enhanced its lithium and cesium-rubidium salt businesses through strategic acquisitions and resource integration, achieving complete self-sufficiency in lithium mining [2][40]. - The company is rapidly expanding into copper mining, planning acquisitions to diversify its resource portfolio and enhance its cyclical resilience [2][14]. Summary by Sections Lithium Business - The company has achieved complete self-sufficiency in lithium mining, with the successful production of two 200,000-ton projects at the Bikita mine in 2023, resulting in a total integrated lithium salt capacity of 66,000 tons [2][40]. - The integration of exploration capabilities has led to a significant increase in resource reserves, with a 239.5% increase in resource volume following the acquisition of Bikita [2][40]. - Cost reduction efforts are ongoing, with plans to replace diesel power with municipal and solar energy at the Bikita mine, which is expected to further optimize lithium salt production costs [2][40]. Small Metals - The company holds two of the only three scalable cesium mines globally, providing it with strong pricing power in the market. The gross profit from cesium-rubidium business has grown from 150 million CNY in 2019 to 720 million CNY in 2023, with a CAGR of 49.2% [2][40]. - The demand for cesium-rubidium products is expected to rise due to the exit of competitors and increasing domestic high-tech industry needs [2][40]. Copper Business - The company is planning to acquire the Tsumeb copper smelter and Kitumba copper mine in 2024, marking a strategic expansion into copper mining [2][14]. - The Kitumba mine is expected to contribute 50,000 tons of copper production capacity in its first phase, with profit contributions anticipated by 2026 [2][14]. Financial Forecast - The company is projected to achieve net profits of 880 million CNY, 1 billion CNY, and 1.72 billion CNY for the years 2024, 2025, and 2026, respectively, with corresponding PE ratios of 23, 20, and 12 times based on the closing price on August 22 [3][2].